Mr. Chairman, I want to thank you for holding this hearing on the affordable housing crisis impacting our nation’s low- and middle- income working families. The theme of this hearing bridges the issues and concerns the Subcommittee has addressed in recent hearings on homelessness, the Section 8 program, and the housing needs of families transitioning off of welfare. I strongly believe that without an increase in affordable housing production, we will fail to resolve these pressing issues.
Mr. Chairman, as Senator Kerry mentioned in his testimony, increasing the production of affordable housing is one of the most critical needs facing working families in our country. I am an original cosponsor of his legislation to create a National Affordable Housing Trust Fund, legislation that should be at the top of our housing agenda.
Mr. Chairman, in 1999, approximately one out of seven American families spent more than half their income on housing. Housing cost increases in our country, and particularly in my state of New Jersey, are far outpacing wage increases. In New Jersey, an individual would have to earn $17.87 an hour – roughly $40,000 a year – in order to earn enough to afford the Fair Market Rent for a 2-bedroom dwelling. This is the equivalent of three minimum wage salaries.
There lack of affordable housing in New Jersey is so severe that the State finds itself paying as much as $2,000 a month to temporarily house families transitioning from welfare to work. As population growth continues to outpace housing production and vacancy rates decline, this shortage will only worsen.
Clearly, something must be done immediately to address the housing shortage.
Mr. Chairman, federal housing assistance programs are currently operating at a maximum. In New Jersey, families wait up to 3 years to receive a Section 8 voucher. Even when they receive that voucher many are unable to find housing.
Despite the fact that we have several programs that invest resources in new housing production and housing rehabilitation, including Section 202 Elderly Housing, the HOME program, and Hope VI, funding for housing production has stagnated and actually decreased over the last twenty years.
We must find ways to provide new funding sources to finance the construction and rehabilitation of affordable housing for our nation’s working families. The National Affordable Housing Trust Fund represents a workable solution that would finance the construction of 1.5 million homes for low-income families by 2010 through FHA mortgage insurance reserves.
Mr. Chairman, the production of affordable housing is critical to the well-being of our nation’s working families and crucial to residents of my state, particularly those trying to achieve economic self-sufficiency. If we expect to end homelessness, improve the Section 8 program, and help families’ transition from welfare to work, we must address the affordable housing crisis now.
The needs are real, and they need real solutions – not more lip service about "compassion." I look forward to working with you toward that end.